Consumers’ charter turns into check list
By Dafydd ab Iago | Wednesday 06 May 2009
MEPs claim to have achieved a clear strengthening of consumer rights in the new Directives, pointing to rights such as that of switching suppliers, compensation if bills are wrong as well as smart meters. All consumers, but especially vulnerable ones, should now benefit from ‘competition’ and ‘fair’ prices, stipulate the directives. Despite the sharpened wording, there is no longer talk of a ‘charter’ of energy consumer rights made binding on energy companies. A mere “energy consumer check list” will list practical information on consumer rights after consultation with stakeholders including member states, national regulatory authorities, consumer organisations, and energy companies. Even before the ink is dry on the legislative texts, consumer organisations are worried that much will also depend on how individual member states implement the rights (see interview with BEUC).
PUBLIC SERVICE OBLIGATIONS
Member states “may” impose public service obligations relating to security of supply, regularity, quality and price of supplies and environmental protection, including energy efficiency, energy from renewable sources and climate protection. The obligations have to be clearly defined, transparent, non-discriminatory, notably guaranteeing equality of access for electricity companies to national consumers. Importantly, a universal service should be guaranteed to all household customers, and, if member states deem it appropriate, small enterprises with fewer than 50 occupied persons and an annual turnover of less than €10 million. This universal service is defined as the right to be supplied with electricity of a specified quality at “reasonable, easily and clearly comparable, transparent and non-discriminatory” prices. Member states may appoint a supplier of last resort and have to impose on distribution companies the obligation to connect customers to their network.
Member states also have to take “appropriate” measures to protect final customers, particularly for “vulnerable” customers. Here, however, the member state defines the concept of vulnerable customer as well as the prohibition of disconnection of such customers at critical times. Member states also have to take measures to protect final customers in remote areas. Appropriate measures noted in the directives are national energy action plans, benefits in social security systems so as to ensure electricity supply to vulnerable customers or support for energy efficiency improvements. Much, though, will be left up to member states in deciding what measures are taken to protect vulnerable consumers. Indirectly, the prohibition of discrimination between payment methods will help vulnerable customers traditionally paying higher rates due to their using coin machines or other pre-payment means.
INFORMATION AND ENERGY EFFICIENCY
Measures to promote energy efficiency should be “strongly” recommended to electricity undertakings, for example, by providing energy management services, developing innovative pricing formulas, as well as introducing intelligent metering systems or smart grids where appropriate. Electricity suppliers will also have to specify to customers information such as the contribution of each energy source to the overall fuel mix of the supplier in the preceding year and information on customer rights as regards dispute settlement. Provision of information is to be backed up by single points of contact that provide consumers with all necessary information on their rights, current legislation and means of dispute settlement. Member states also have to ensure that an independent mechanism, whether an energy ombudsman or consumer body, is established for complaints and out-of-court dispute settlements.
New consumer rights
The directives guarantee universal service with reasonable and non-discriminatory prices to all ‘household’ customers and SMEs with fewer than 50 employees. There should also be special protection measures for vulnerable energy consumers. These measures include energy benefits in social security systems or energy efficiency improvements. Specific new rights outlined in the 2009 gas and electricity directives give consumers the right to change their gas and electricity suppliers within three weeks and free of charge; receive a final closure account at the latest six weeks after switching suppliers; receive all relevant gas and electricity consumption data; access to an independent complaints procedure and out-of-court dispute settlements; compensation if service quality levels are not met; andinformation on their rights through bills and company websites.